A heated discussion on the topic erupted two weeks ago at the SIFMA Market Structure where Larry Leibowitz, NYSE Euronext's Group EVP, Head of U.S. Markets and Global Technology, questioned whether the flash orders were in the interest of the customer. "Does the institution know that their order has been sent out to a group of brokers that have the option of matching the order before it goes out to the market?" asked Leibowitz, who called this information leakage and made a case for more surveillance for look receivers.

Another point raised on the SIFMA panel was that flash quotes were being disseminated through a private network and not going through the national quotation system or SIP (securities information processor). In NYSE Euronext's letter, the exchange said these private quotes are actionable orders and should be disseminated through the joint industry plans and rules for disseminating market data. But on the SIFMA panel, David Shilman, the SEC's Associate Director, Division of Trading and Markets, said. "The Commission's view is that flash orders that are for a sub-second period of time, are consistent with the quote rule which allows an exemption for orders that are accepted immediately. That is the current state of the regulatory structure," adding, "Should it continue to be that way." Shilman said it would be counterproductive to put the sub-second flash quotes in the SIP because by the time it was disseminated, the market would have moved and the quote is no longer there. But Shilman, added, as the SEC goes forward, "We will examine whether the exemption in the quote rule should be modified and whether it is necessary to have that rule."

On the SIFMA conference panel, Hyndman was asked, what happens if a flash quote misses the displayed NBBO and result in an inferior NBBO, and, what happens if the market moves during the flash? "If the market moves during the flash, the order probably won't get executed and it will be canceled," said Hyndman on the panel.